Sony To Purchase Sonic Foundry
May 05, 2003
Culver City, CA and Madison, WI - Sony Pictures Digital has struck an agreement to purchase all of Sonic Foundry's desktop software products and related assets, the companies have announced.
The purchase price includes $18 million cash and assumption of certain trade payables, accrued liabilities and capital leases associated with the desktop software business.
The Board of Directors of Sonic Foundry has approved the transaction and certain shareholders have agreed to vote their shares in favor of the sale. Approval of the agreement may be subject to Sonic Foundry shareholder approval and other various conditions.
The acquisition of Sonic Foundry's desktop software follows the recent retail release of Sony Pictures Digital's Screenblast Movie Studio and Screenblast Music Studio video and music-mixing applications created in conjunction with Sonic Foundry's award-winning software team.
Sonic Foundry will file a proxy statement shortly with the SEC and mail to
investors of record as of April 25 detailing the proposed transaction up for
possible approval at its June meeting in Madison, WI. The company expects
to close the transaction within a few days following the shareholder
meeting.
The signed agreement marks a major milestone in Sonic Foundry's longer-term
strategy to concentrate on markets where rich media solutions are being
embraced. The company will use the proceeds to pay off debt and fund its
operations for its Web-based rich media communications product, MediaSite
Live and related offerings.
Sale of the desktop software assets includes Sonic Foundry's popular,
industry-leading ACIDR, Sound Forge and Vegas series of software products,
as well as other related assets. Sony anticipates maintaining the group's
Madison, WI base.
"During the past three years, we have come to recognize and admire Sonic
Foundry's engineering expertise and value their software applications. We
are excited to integrate this world-class team and their products into our
ongoing efforts to produce and deliver the next generation of consumer entertainment services," said Patrick Kennedy, executive vice president of Sony Pictures Digital.
"The sale of our music and video digital software products is a key
milestone in Sonic Foundry's history," said Rimas Buinevicius, chairman and
CEO of Sonic Foundry. "We couldn't pick a better partner than Sony Pictures
Digital to carry on the same passion and success we've achieved over the
past 12 years," he said. "Consummation of this agreement will give us the
cash we need to pay our debt and allow us to focus our attention on writing
the next successful chapter of Sonic Foundry's story - rich media - and
building upon the early success we've already achieved with our Web
presentation solution, Media Site Live."
Sony Pictures Digital oversees the digital production and online assets of
Sony Pictures Entertainment and leads its efforts to develop and provide new
forms of online content, games, interactive programming, open-access
video-on-demand and wireless entertainment. Screenblast, which debuted
in September 2001, gives the consumer the ability to create, enhance and
share their digital videos, music and photos with a combination of a
powerful software suite and an easy-to-use online service for sharing and
personalizing consumers' media. Screenblast Movie Studio and Screenblast
Music Studio software have been available through retail outlets since
October 2002.
For more information, visit
www.sonypictures.com
or
www.sonicfoundry.com
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